CVS stock plunges after Blue Shield of California drops company's PBM to save on drug costs

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Blue Shield’s announcement hints at the potential for health insurers to abandon the traditional PBM system.

Blue Shield CEO Paul Markovich said the plan, which is slated to fully launch in 2025, could save the company up to $500 million annually.

Amazon Pharmacy will offer at-home drug delivery. Cuban's Cost Plus Drug Company will provide access to low-cost medications through retail pharmacies. Another company, Abarca Health. will process drug claims. Blue Shield will retain CVS Caremark for its specialty pharmacy services, which provide specialized therapies and counseling to patients suffering from complex disorders.

"We look forward to providing care for Blue Shield of California's members who require complex, specialty medications – as we have for nearly two decades," said Michael DeAngelis, a spokesman for CVS Health, in a statement to CNBC. Still, the loss of Blue Shield's PBM partnership is another blow to Caremark, which is also set to lose another contract with

 

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